Cryptocurrencies and Blockchain: Bitcoin, Mining and DeFi
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Global Trends (2020–2024)
Market Cycles & Performance:
Sanctions-Driven Adoption:
Crypto vs. Other Alternative Assets
Conclusion:
Crypto offers asymmetric returns but with unparalleled regulatory/technical risk. In Russia, it serves as a sanctions-evasion tool with mining being the sole semi-legitimate sector. Saint Petersburg’s energy access enables tactical mining plays. Global investors should prioritize Russian exposure in Mining, given the actual legal framework and cheap electricity costs.
Market Cycles & Performance:
- Bitcoin: Volatile growth (2021: +60% YoY; 2022: -65% YoY; 2023: +155% YoY; 2024 YTD: +80%). Institutional adoption via ETFs ($30B+ inflows).
- Mining: Hashrate ↑350% since 2020. Profitability hinges on energy costs ($0.03–0.05/kWh break-even). Post-2022 shift to renewable/low-cost regions.
- DeFi: TVL peaked at $180B (2021), crashed to $40B (2022), recovered to $100B (2024). Dominated by lending (Aave, Compound) and DEXs (Uniswap).
- Regulation: MiCA (EU) and U.S. crackdowns (SEC lawsuits) formalized oversight.
- Institutionalization: Spot Bitcoin ETFs (U.S.) attracted $15B+ in 2024.
- Mining Sustainability: 54% now uses renewable energy (vs. 39% in 2020).
- DeFi Risks: $3B+ hacked in 2022–2023; oracle manipulation and rug pulls persist.
Sanctions-Driven Adoption:
- Legal Gray Zone: Crypto recognized as property (2020) but banned for payments. Mining legalized in 2022; electricity subsidies in regions, new regulation in 2024, crypto assets are now considered legal tender, mining is approved only in certain regions.
- Mining Boom: 10% global hashrate share (2024), fueled by cheap energy ($0.04/kWh avg.) and state tolerance.
- No banking rails (SWIFT alternatives like CBDCs stalled).
- "Digital Ruble" trials limited; distrust in state-controlled crypto.
Crypto vs. Other Alternative Assets
Attribute | Crypto/Blockchain | vs. Real Estate | vs. Private Equity | vs. Commodities |
Return Potential | Extreme volatility (±50–200% YoY) | Stable (6–9% IRR) | High (15–25% IRR) | Moderate (10–30% cycles) |
Liquidity | High (CEXs) but regulatory gaps | Illiquid | Very Low | High (futures) |
Income | Staking (2–8%), mining margins | Rental yield | None | None |
Regulatory Risk | Extreme (global crackdowns) | Local policy risk | Sanctions | Low (exchange rules) |
Operational Burden | Mining (hardware/energy), DeFi APY mgmt | Management intensity | Active governance | Passive (futures) |
Inflation Hedge | Theoretical (BTC); untested in RUB | Strong | Weak | Strong |
Russian Viability | Mining only (energy arbitrage) | Warehouses viable | Defense/state ventures | Domestic metals/agri |
Conclusion:
Crypto offers asymmetric returns but with unparalleled regulatory/technical risk. In Russia, it serves as a sanctions-evasion tool with mining being the sole semi-legitimate sector. Saint Petersburg’s energy access enables tactical mining plays. Global investors should prioritize Russian exposure in Mining, given the actual legal framework and cheap electricity costs.
Only mine via fixed-energy contracts with approved providers
Contact us today to unlock the full potential of your capital
Contact us today to unlock the full potential of your capital
Contacts
Tel: +79052255567
email: info@dma-invest.com
Address: St. Petersburg, 191123, Zakharyevskaya st., 25 letter A, premises. 21-n, office 508
email: info@dma-invest.com
Address: St. Petersburg, 191123, Zakharyevskaya st., 25 letter A, premises. 21-n, office 508
About the company
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Contacts
OOO "DMA INVEST"
St. Petersburg, 191123, Zakharyevskaya st., 25 letter A, premises. 21-n, office 508
Russian Federation
Tel: +79052255567
email: info@dma-invest.com
St. Petersburg, 191123, Zakharyevskaya st., 25 letter A, premises. 21-n, office 508
Russian Federation
Tel: +79052255567
email: info@dma-invest.com